FEC approves 500 million Euros for financing major projects

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The Federal Executive Council (FEC) on Wednesday approved the issuance of a Sovereign Guarantee of 500 million Euros (N200bn) from the Credit Suisse AG London Branch and a syndicate of international lenders as collateral for 500m Euro facility to the Bank of Industry(BoI), to finance major industrialization projects and micro- small and medium enterprises values chains in Nigeria for up to five years tenure at affordable rates.

Clement Agba , the Minister of State, Budget and National Planning, who made the disclosure to State House Correspondents after the FEC meeting, said the loan was basically for up to five years tenure at affordable rates.

Agba, who said the rates are single digit rates, said the guarantor of the loan, to be executed through the Ministry of Finance, Budget and National Planning, shall be the Federal Republic of Nigeria.

He added that the main objective of the loan was to support industry, revitalise agro-industrial processing zones, and facilitate the creation of new jobs.

“We do believe that about 1.2 million jobs will be created through this facility; increase the income of farming communities and promote the inclusion of SMEs and small holder producers in the industrial value chain and the deployment of transportation infrastructure that connect farming communities to processors and market.

The loan will be swapped to Naira by the CBN to mitigate the foreign exchange risk and the fund will, therefore, be available to Nigerian enterprises at a more affordable rate and in local currency,” he added.

In a related development, the Minister of Power, Engr. Sale Mamman, said the FEC approved the memo seeking for the ratification of the president to release $2 million as part of Nigeria’s contribution to the West African Power Pool.

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